The San Jose Corporation Uses Two Materials in the Production

question 122

Multiple Choice

The San Jose Corporation uses two materials in the production of its product. The materials, G and H, have the following standards: During June, the following actual production information was provided:
Material Actual Mix
G 45,000 units
H 30,000 units
Yield 54,000 units
What is the materials mix variance?

• A) $18,000 (
• B) $18,000 (
• C) $22,500 (
• D) $22,500 (

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Definitions:

Real Exchange Rate

The rate at which the currency of one country can be exchanged for the currency of another country, adjusted for inflation.

Nominal Exchange Rate

The price at which one currency can be exchanged for another currency, without adjustment for inflation.

Pesos

Pesos are the unit of currency in several countries, including Mexico and the Philippines.

Purchasing-Power Parity

An economic principle positing that currency exchange rates reach equilibrium when the purchasing power in both countries involved is equal.